Hi-Tech Pipes achieves 15% Volume Growth in Q1 FY20
New Delhi : HI-Tech Pipes Limited (NSE: HITECH) has announced it's un-audited consolidated financial results for the First Quarter ended June 30th, 2019.
HI-Tech Pipes Limited (NSE: HITECH), incorporated in 1985 - is amongst leading steel processing Companies in India providing good quality products for nearly three decades with presence in MS steel pipes, hollow section tubes, GI & GP Pipes, cold-rolled coils & strips, metal beam crash barriers, solar mounting structures and a variety of other galvanized products.
The Company's Net volume in Q1 FY 2020 is 69035 metric tonne as against 60,020 mt in Q1 FY 19. A Year on Year growth of 15% has been achieved over the corresponding quarter, driven by an increase in capacity utilization at all the manufacturing plants.
The Net Revenue from operations is Rs 324 crore in Q1 FY 2020, as against Rs. 321 crore in Q1 FY 2019. This is a Year on Year growth of 1%. As against the increase in the volume of 15%, new revenue has increased by 1% only, mainly on account of the decrease in steel prices.
EBITDA stood at Rs. 18.56 crore in Q1 FY 20 as against Rs. 17.44 crore in Q1 FY 2019, Year on Year growth of 6%. As against volume increase of 15%, EBIDTA has increased by 6% only mainly due to increase in employee cost (on account of new capacities, a result of which will come in subsequent quarters) and some impact of inventory valuation due to a reduction in steel prices.
Profit after Tax is Rs. 7.1 Crore in Q1 FY 2020 as against Rs. 6.5 crore in Q1 FY 2019, YoY growth of only 8%. The Basic EPS is Rs. 6.6 in Q1 FY 2020 as against of Rs. 6.16 in Q1 FY 2019.
Commenting on the Company’s performance for Q1 FY 20, Mr Ajay Kumar Bansal, Chairman and Managing Director, HI-Tech Pipes Ltd. said:
“In Q1-FY 20 in-spite of a challenging situation in the market, we have achieved volume growth of 15%. Growth in value terms is not significant due to the reduction of steel prices. EBIDTA pmt has decreased from Rs 2906 in Q1 – FY 19 ( Rs 2789 in FY 19) to Rs 2688 in Q1-FY 20 due to an increase in employee cost ( on account of new capacities) and some impact of inventory valuation due to the reduction in steel prices.
"However with company’s continuous thrust on sales & marketing of High Value-Added products viz Pre Galvanised Pipes, Galvanised Pipes, Productivity improvement, cost reduction etc, and after stabilization of steel prices, it is expected that in rest of the FY 20, EBIDTA margin PMT will increase," Mr Bansal asserted.
"Over the last 6 months, the company has undertaken various branding & marketing initiatives viz change of Hi-Tech Brand Logo & tag line, Distributors & Dealers engagement activities, which will certainly help in strengthening its position in the market & creating Hi-Tech Pipes as the most preferred brand by customers."
With increased focus on the part of the government for creation of large scale infrastructure in the country viz Mission Jal Shakti – Nal Se Jal, City Gas Distribution, Water Grids, Affordable Housings, Renewable Energies, Transmission and Telecom, Aviation and Agriculture etc demand for steel pipes tube will increase with a CAGR of more than 11% over next 5 years,” he concluded.